The Israeli Defence minister Ehud Barak yesterday warned that the world would soon no longer tolerate the Jewish state's continued rule over the Palestinian people.

His comments come as Israel's right-wing coalition government navigates its deepest rift in years with the US, its closest ally, over Jewish settlement building in Arab-dominated East Jerusalem and the occupied West Bank.

After just over a year in government, Prime Minister Benjamin Netanyahu's government is facing growing international opprobrium over its policies in the Gaza Strip and the West Bank, and its perceived ambivalence towards the impasse in the peace process.

In an interview with Israel Radio, Mr Barak noted that Mr Netanyahu's government has "done things that didn't come naturally to it", such as giving its support to a two-state solution, and called for a "far-reaching Israeli diplomatic initiative" on peace.

"The world isn't willing to accept the expectation that Israel will rule another people for decades more," said Mr Barak, who warned in February of an apartheid state if Israel failed to secure peace. "There is no other way, whether you like it or not, than to let them [the Palestinians] rule themselves."

Mr Netanyahu's government has yet to respond to Washington's demands in March for concessions to the Palestinians to bring them back to the negotiating table. But, in an indication that the government is divided on how to respond to the US, Mr Netanyahu told ABC television that he will not cave in to Palestinian demands to cease building in East Jerusalem.